In Town of Venice v. Murdock, the Supreme Court of the United States was asked to decide whether a municipality could impose a tax on a non-resident for the privilege of doing business within its limits. The case arose when the Town of Venice, Florida, imposed a tax on a non-resident, Murdock, for the privilege of selling goods within the town. Murdock challenged the tax, arguing that it was unconstitutional. The Supreme Court held that the tax was unconstitutional. The Court reasoned that the tax was a direct burden on interstate commerce, and thus was prohibited by the Commerce Clause of the United States Constitution. The Court noted that the tax was imposed on Murdock solely because he was a non-resident, and that it was not imposed on residents of the town. The Court further noted that the tax was not imposed on the goods themselves, but rather on the privilege of selling them within the town. The Court concluded that the tax was an unconstitutional burden on interstate commerce, and thus was invalid. The Court held that the Town of Venice could not impose a tax on a non-resident for the privilege of doing business within its limits.

Justice Field delivered the dissenting opinion in Town of Venice v. Murdock, arguing that the majority's decision was contrary to established precedent and would lead to absurd results. He argued that a municipality cannot be held liable for damages caused by its negligence unless it has been given express authority from the state legislature or is acting under an implied power granted by law. The majority had found such authority based on a statute allowing municipalities to construct wharves and docks, but Justice Field disagreed with this interpretation because there was no indication that this statute gave any powers beyond those necessary for constructing these structures. Furthermore, he noted that if every act of negligence committed by municipal officers were actionable against the municipality itself, then cities would become subject to immense liability which could bankrupt them without providing any benefit to citizens who have suffered losses due to their actions.